Majority owner Shaw-Lan Wang will infuse new cash into the label after reports that its financial situation is becoming critical.

PARIS— Taiwanese media magnate Shaw-Lan Wang said on Tuesday that she would inject fresh funds into Lanvin before the end of the year amid reports that the luxury firm is struggling.

“Mrs. Shaw-Lan Wang has always believed in the house of Lanvin, and believes in its future and its talented teams who are working with a lot of positive energy to implement a plan that will restore Lanvin to the position it deserves,” the company said in a statement.

“For that matter, she has taken the decision to inject funds before the end of 2017 to support future initiatives. Several areas of development will be announced before the end of the year,” it added.

Following his appointment, minority shareholder Ralph Bartel and investment banker Pierre Mallevays of Savigny Partners, both board members, submitted letters of resignation to disassociate themselves from Wang’s decisions and governance.

Wang said she stood by the appointment of Lapidus, noting that he won a Dé d’Or (Golden Thimble) award in 1994 for his haute couture designs.

An auditor has issued a warning over the label’s financial situation, said a source familiar with the matter, confirming a Reuters report. This follows several changes in the creative direction of the house since Wang in 2015 pushed out Alber Elbaz, who catapulted the brand’s notoriety during his 14-year tenure.

The oldest French fashion house still in activity has seen sales erode since a peak of 235 million euros in 2012. Last year, revenues fell 23 percent to 162 million euros, with a net loss of 18.3 million euros, marking the house’s first red ink in nearly a decade, with expectations of worsening losses this fiscal year.

A spokesperson for Lanvin said the company would not confirm any sales figures before the end of the year.

The company’s works council launched a “right to notify” procedure requiring an audit amid concerns that the company would not be able to pay employees’ salaries after Dec. 31, according to a second source. “Lanvin has always paid its employees and will continue to do so,” the company’s spokesperson told WWD.

The house could shutter its flagship men’s store in Paris after losing out on the sale of its historic headquarters to the real estate arm of Compagnie Financière Richemont.

The descendants of house founder Jeanne Lanvin sold the building on Rue du Faubourg Saint-Honoré this summer for a sum estimated at between 150 million euros and 200 million euros, according to the first source.

Jeanne Lanvin SA, which has launched a cost-cutting drive, could not afford a counter-bid and will now engage in talks with Richemont Immobilier over the future of the historic location.

A Richemont spokesperson confirmed the acquisition in Paris but declined further comment. The Lanvin spokesperson said: “No decision has been taken at this stage, several options could be considered.”

“It’s going to take years,” said the source. “If it’s well negotiated, Lanvin could stand to receive several tens of millions of euros in compensation for vacating the space, given how long it’s been there.”

Though Lanvin did not indicate the size of the capital injection, it comes at a crucial time for the company, which is under pressure to sell assets or grant licenses to raise cash.

Lanvin is said to have the option in 2025 to buy back its trademark registrations in the cosmetics class that Wang sold for 22 million euros to Interparfums SA in August 2007. (At the time, the investment community frowned on the move, as it diminished the valuation of the fashion house.)

The price Lanvin would pay in 2025 is linked to its turnover in the category generated by Interparfums SA.

Interparfums SA is believed to have suggested to Lanvin this summer that it could postpone that option by a decade in exchange for a cash payment now. It was understood that Wang would be on board with the idea as a means to inject money into the Lanvin fashion business.

In the first nine months of 2017, Lanvin fragrance sales were back to black, up 14.4 percent to 47 million euros, spurred by the launches of Modern Princess and the ongoing strength of Éclat d’Arpège.

According to industry sources, orders for women’s collections have been falling at a steep double-digit rate, with retailers including Saks Fifth Avenue dropping the collection. The brand has also struggled to build a handbag business, a chief pillar for most European fashion firms.

There is uncertainty also over a potential settlement with Elbaz, who at the time of his departure held an ownership stake in Lanvin via a holding controlled by Wang. Elbaz did not reply to a request for comment on the matter.

Yet Wang has steadfastly resisted selling the label, resulting in the dispute that caused her rift with Elbaz. Mayhoola Group is said to have expressed interest prior to the Qatari investment group’s 2016 acquisition of Balmain, but balked at the price Wang was seeking, said to be in the neighborhood of 500 million euros.

Kering is said to be keeping a close eye on the situation, although the French group has said in recent months it is not in the market for acquisitions.

Speaking at a private presentation at the men’s store on Monday, Druz was defiantly upbeat, saying he was confident in the capacities of the company’s staff.

“Nobody realized how ambitious we were in producing an entire collection in 42 days in the middle of August,” he said. “I think we restored everyone’s pride, because we were capable of creating 60 pieces in 42 days. Nobody in the world is capable of doing that.”

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